The Social Construction of a Transnational Corporation

notes on Vale’s "new ‘privatization’"

Abstract

In this article, I discuss State-market relations in Brazil, with a focus on the emergence of a new corporate governance (GC) regime as an institutional order and its power effects on political and economic actors. Accordingly, the explanation brings together context-driven changes in owners’, managers’ and the State’s actions to explore the institutional change in a Brazilian corporation, Vale S.A., towards a “new corporate governance”. I argue that a new structure of intra- and inter-corporate pressures shapes Vale’s corporate framework to the Anglo-American CG model, with relevant effects for the firm and its actors. Investigation employed document analysis, focusing predominantly on corporate reports and media documents, as well as participant observation techniques. Results are consistent with a process of rearrangement of Vale's internal power structure, with relative loss of influence of the pension funds, public bank and Federal Government, but also autonomy retreat of the company directory body, in favor of external institutional investors and of financial market actors.